Correlation Between AIRBNB INC and ANGI Homeservices
Can any of the company-specific risk be diversified away by investing in both AIRBNB INC and ANGI Homeservices at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining AIRBNB INC and ANGI Homeservices into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AIRBNB INC DL 01 and ANGI Homeservices, you can compare the effects of market volatilities on AIRBNB INC and ANGI Homeservices and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in AIRBNB INC with a short position of ANGI Homeservices. Check out your portfolio center. Please also check ongoing floating volatility patterns of AIRBNB INC and ANGI Homeservices.
Diversification Opportunities for AIRBNB INC and ANGI Homeservices
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between AIRBNB and ANGI is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding AIRBNB INC DL 01 and ANGI Homeservices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANGI Homeservices and AIRBNB INC is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on AIRBNB INC DL 01 are associated (or correlated) with ANGI Homeservices. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANGI Homeservices has no effect on the direction of AIRBNB INC i.e., AIRBNB INC and ANGI Homeservices go up and down completely randomly.
Pair Corralation between AIRBNB INC and ANGI Homeservices
Assuming the 90 days horizon AIRBNB INC is expected to generate 1.41 times less return on investment than ANGI Homeservices. But when comparing it to its historical volatility, AIRBNB INC DL 01 is 1.87 times less risky than ANGI Homeservices. It trades about 0.04 of its potential returns per unit of risk. ANGI Homeservices is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 158.00 in ANGI Homeservices on September 1, 2024 and sell it today you would earn a total of 17.00 from holding ANGI Homeservices or generate 10.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AIRBNB INC DL 01 vs. ANGI Homeservices
Performance |
| Timeline |
| AIRBNB INC DL |
| ANGI Homeservices |
AIRBNB INC and ANGI Homeservices Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AIRBNB INC and ANGI Homeservices
The main advantage of trading using opposite AIRBNB INC and ANGI Homeservices positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AIRBNB INC position performs unexpectedly, ANGI Homeservices can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in ANGI Homeservices will offset losses from the drop in ANGI Homeservices' long position.| AIRBNB INC vs. Virtus Investment Partners | AIRBNB INC vs. Mitsubishi Materials | AIRBNB INC vs. SANOK RUBBER ZY | AIRBNB INC vs. EAGLE MATERIALS |
| ANGI Homeservices vs. HEALTHCARE REAL A | ANGI Homeservices vs. United Insurance Holdings | ANGI Homeservices vs. Reinsurance Group of | ANGI Homeservices vs. Japan Post Insurance |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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